New Michigan Law Regarding Prior Authorization Takes Effect June 1st

Process Designed to Be Quicker, More Effective, and Transparent

By: Stephanie Davidson, MAC Insurance Relations Manager

In April 2022, legislation promising prior authorization (PA) reform was signed into law by Governor Whitmer. The goal of the new law (Public Act 60 of 2022) is making the PA process faster, more effective, and transparent. It includes a standardized electronic prior authorization request transaction process, a requirement that prior authorization requirements be based on peer-reviewed clinical review criteria that meet certain requirements, and expedited review timelines. The new law is fully effective as of June 1, 2023.

It should be noted that in no way does Public Act 60 repeal prior authorization.

Among other provisions, the new law:

  • Requires insurers that require a prior authorization with respect to any benefit to make available, by June 1, 2023, a standardized electronic prior authorization request transaction process.
  • Requires prior authorization requirements to be based on peer-reviewed clinical review criteria that meet certain requirements.
  • Requires insurers to post on their website if they implement a new prior authorization requirement or restriction – or amends an existing requirement or restriction – with respect to any benefit under a health benefit plan.
  • Requires an adverse determination regarding a request for a prior authorization for a benefit other than a prescription drug benefit to be made by a licensed physician.
  • Requires an insurer or its designee utilization review organization to notify, on issuing a medical benefit denial, the health professional and insured or enrollee of certain information, including the right to appeal the adverse determination, and require an appeal of the denial to be reviewed by a health professional to which certain requirements apply.
  • Prohibits an insurer or its designee utilization review organization from affirming the denial of an appeal unless the appeal is reviewed by a licensed physician who meets certain qualifications.
    Prescribes procedures for granting a prior authorization request that has or has not been certified as urgent by a health care provider.
  • Requires insurers to adopt a program that promotes the modification of prior authorization requirements of certain prescription drugs, medical care, or related benefits, based on certain factors. 

Timeline: Urgent Vs. Non-Urgent Prior Authorization Requests

Under the new law, “urgent” means “an insured or enrollee is suffering from a health condition that may seriously jeopardize the insured’s life, health, or ability to regain maximum function or could subject the insured or enrollee to severe adverse health consequences that cannot be adequately managed without the care or treatment that is the subject of the prior authorization.” Beginning June 1, 2023, and moving forward, these PA requests must be acted upon within 72 hours, or they are considered granted.

For non-urgent prior authorization requests:

  • June 1, 2023, through May 1, 2024: Request must be acted upon within nine (9) calendar days. If the insurer fails to act within this time frame, the request is considered granted.
  • After May 1, 2024: The time frame shifts to seven (7) calendar days for non-urgent requests.
    The decision is good for a minimum of 60 days, or the length of time that’s “clinically appropriate,” whichever is longer.
  • Please note: If the insurer (or its designated utilization review organization) requests additional information, be sure to provide it as quickly as possible, as the above turnaround times reset and the insurer will be required to make its determination following the receipt of the requested information within the above timelines.

Electronic Submissions

Beginning June 1, 2023, all requests for prior authorization must be submitted electronically, “unless the health professional is unable to use the standard process because of a temporary technological or electrical failure.”

“Peer-Reviewed Clinical Review Criteria”

All PA requirements must be based on “peer-reviewed clinical review criteria” that must do all of the following:

  • Take into account the needs of atypical patient populations and diagnoses.
  • Reflect community standards of care.
  • Ensure quality of care and access to needed health care services.
  • Be evidence-based criteria.
  • Be publicly available free of charge.
  • Be sufficiently flexible to allow deviations from norms when justified on a case-by-case basis.
  • Be evaluated and updated, if necessary, at least annually.

Adverse Determinations

For an adverse determination regarding a request for prior authorization for a benefit other

than a prescription drug, the adverse determination must be made by a licensed physician. If the PA request is denied, the insurer must notify the health professional and insured or enrollee of the reasons for the denial and related evidence-based criteria, the right to appeal the adverse determination, instructions on how to file the appeal, and additional documentation necessary to support the appeal.

Appeals must be reviewed by a health professional who does not have a direct stake or any financial interest in the outcome of the appeal, has not been involved in making the adverse determination, and considers all known clinical aspects of the health care services under review (including a review of all pertinent medical records provided to the insurer or designee utilization review organization by the insured or enrollee’s health care provider and any relevant records provided to the insurer or designee utilization review organization by a health care facility).

It should be noted that the reviewing health professional can – but is not required to – consider input from a health professional who is licensed in the same profession as the health professional providing the health care service.

Insurers are not allowed to affirm the denial of an appeal “unless the appeal is reviewed by a licensed physician who is board certified or eligible in the same specialty as a health care provider who typically manages the medical condition or disease or provides the health care service.” However, if an insurer or its designee utilization review organization cannot identify a licensed physician who meets the requirements described above without exceeding the applicable time limits imposed under the bill, the insurer or its designee review organization may utilize a licensed physician in a similar general specialty as considered appropriate, as determined by the insurer or its designee utilization review organization.

Additional Information

Disclaimer: This article is meant to be information only, is not all-inclusive, and does not constitute legal advice regarding any specific matter or situation. Legal information is not the same as legal advice, which is the application of law to an individual’s specific matter, situation, or circumstances. Legal advice may be given only on the basis of specific facts relayed by a client to an attorney. The MAC goes to great lengths to make sure our information is as accurate, useful, and up to date as possible. We recommend, however, that you consult an attorney if you want or need professional assurance that our information, and your interpretation of it, applies to your specific legal situation.

Meridian Medicaid: New Prior Authorization Requirements Beginning July 1st

Prior Authorization Needed for Chiropractic Services Exceeding 18 Visits or More

Effective July 1, 2023, Meridian Medicaid will require prior authorizations for specific medically necessary chiropractic services (CPT codes 98940, 98941, and 98942) exceeding 18 visits. Prior authorization should be requested before performing any spinal manipulation that exceeds the 18-visit limit.

Please note: The initial 18 visits will not require prior authorization.

Prior authorization can be obtained on Meridian’s website: www.mimeridian.com > For Providers > Pre-Auth Check > Medicaid.

 

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